Headlines

India’s top-performing local corporate bond fund is making another contrarian bet after its decision to buy notes during last year’s liquidity squeeze in the market paid off, Bloomberg News reported. DSP Investment Managers’ corporate bond fund is adding to holdings of debt from non-banks even as the shock defaults by Infrastructure Leasing & Financial Services Ltd., sometimes called India’s mini-Lehman moment, still hang over the sector’s debt. Those notes offer higher yield premiums than publicly owned companies.

China’s central auditing authority has sounded the alarm on a surge of bad debt at small banks around the country, raising the question of whether Beijing will continue to bail out struggling lenders or eventually allow some to go bankrupt, the Financial Times reported. The National Audit Office said that some banks in Henan province in central China had recorded 40 per cent of their loan books as bad debt by the end of 2018, the first official disclosure in decades of such high rates of toxic assets.

More of India’s smaller banks may become acquisition targets if the regulator gives a nod to the proposed merger of Lakshmi Vilas Bank Ltd. and Indiabulls Housing Finance Ltd., according to Credit Suisse Group AG analysts. If approved, the deal would be the first example of a non-bank financial company like Indiabulls Housing merging with a bank, following the 2016 relaxation of Reserve Bank of India rules, Bloomberg News reported.

Debenhams Plc rejected billionaire Mike Ashley’s latest rescue offer, increasing the odds that he and fellow shareholders will get wiped out as lenders take control of the troubled retailer, Bloomberg News reported. Ashley’s Sports Direct International Plc said Debenhams turned down its proposal to underwrite a 150 million-pound ($196 million) equity raising on the same day that restructuring talks with creditors are due to reach a conclusion. Ashley disclosed the last-ditch offer earlier on Monday, a move to prevent losing much of his equity investment in the department-store chain.

One of China’s top commodity traders, Tewoo Group, is selling copper at below market rates as it grapples with a liquidity crunch, according to people with knowledge of the matter. The company, which is owned by the local Tianjin government, is offloading some refined copper stocked in bonded zones as it unwinds financing deals with some banks, said the people, who asked not to be identified as the information isn’t public, Bloomberg News reported. The metal is used as collateral in financing agreements or committed assets in so-called repurchase agreements with banks, they said.

Turkish companies are struggling to get off the hamster wheel of debt as foreign borrowings run near record highs, Bloomberg News reported. The reason: a plunge in the lira that has driven up the cost of their obligations in dollars and euros. Banks are being left to carry the burden amid a surge in demand from some of the country’s industrial giants to restructure their liabilities -- on top of a jump in bad loans. Lenders are also pulling back on providing new credit as the financial system comes under increasing pressure from the recession and an inflation rate of almost 20 percent.

A British court has shut down UK Renewable Investments (UKRI) after it failed to pay back millions of pounds of investor funds, the government said on Monday. The Business and Property Courts in Manchester, northwest England, wound the firm up last week and has appointed a liquidator, Reuters reported. Between July 2015 and September 2016, Darlington, northeast England-based UKRI sold corporate bonds, raising 2.5 million pounds ($3.3 million). Investors were told the funds would go to developing plants which generate renewable energy.

Indebted German wind turbine manufacturer Senvion said on Monday it was continuing talks aimed at shoring up its finances and would not rule out any options, Reuters reported. The Hamburg-based company, previously known as REpower, has faced delays and penalties related to big projects. It needs at least 100 million euros ($112 million) in the short term to keep operating, two financial sources told Reuters. Senvion, which has more than a billion euros of debt, was not immediately available to comment.

A Brazilian appeals court ruled on Monday in favor of several Avianca Brasil lessors, granting them the right to repossess over 15 planes, legal records show, amid a renewed push to retrieve the Airbus jets from the struggling airline, Reuters reported. Avianca Brasil filed for bankruptcy in December after falling behind on airplane lease payments and has managed to hold on to most of its planes amid a dizzying number of court cases.

Eurozone governments approved the release of €1 billion ($1.1 billion) of funds for Greece, after a monthslong spat over whether the country is reneging on the economic overhauls that it promised when its bailout ended, The Wall Street Journal reported. Eurozone finance ministers meeting in Romania on Friday decided that Greece has enacted enough overhauls to receive the money, which come from the profits that eurozone central banks made on Greek government bonds during the country’s debt crisis.